Corn prices in Ukrainian ports have dropped slightly despite the threat of attacks

At the end of the week, the logistical tension that caused the cost of transportation to jump to record levels began to weaken in the Ukrainian grain market. This was told to Latifundist.com by the co-founder of the brokerage company White Brokers, Kostyantyn Halakhandryk.

According to him, at the beginning of the week, logistics prices rose sharply, in some places up to 1.8–2 thousand UAH per ton. The highest rates were recorded in the Kyiv region and part of the Sumy region. However, there were few real deals at such prices.

“This logistics hype began to subside somewhat by the end of the week. Free wagons even began to appear. It was a situational hype, where large volumes of shipments of old forwards, “burning” contracts and forwards extended for the third time were superimposed on the difficult situation in terms of traction. “The wagons are standing idle, the wagons are moving very slowly,” says Halakhandryk.

In his opinion, this gives reason to expect a decrease in transportation costs by 100–200 UAH/t.

The situation is also affected by problems with port infrastructure. Due to power outages and delays in approving plans, congestion arose in some terminals. This led to the fact that some wagons arrived for loading without confirmed plans, and the owners had to urgently reorient them to other batches or transfer them to other senders. As a result, the supply of free wagons increased, said Halakhandryk.

He noted that despite the constant arrivals, threats of repeated strikes and an increased supply of corn, prices at the ports dropped slightly – from $211–212/t to $208–209/t. It is difficult to assess the dynamics in currency terms due to strong fluctuations in the hryvnia exchange rate.

Halakhandryk also predicts that prices on the western border may decrease in the coming days. Currently, they are only a few dollars lower than the port prices, which makes this direction attractive for farmers from the western regions. However, the high supply wave is quickly changing the situation.

Currently, end buyers at the border are buying corn for January delivery at a price of 184–185 euros/t, and for March–April – about 188 euros/t.

“But the situation is changing rapidly at the border, it is also subsiding due to the supply wave. The supply has really gone and it will remain. There will be active supply from farmers for the next 10 days, then they will be preparing for the holidays. But we cannot say that this is a super-mass supply, that prices are falling, because there is a very large supply wave. No, this is not quite so,” added Halakhandryk.

Tags: Ukraine, corn, prices